Costco sells bulk vitamins, tires, now personal health insurance

Never mind the pallet of paper towels or the flat-screen TV the size of Oklahoma.

The next time you visit Costco, you might want to check out the health insurance.

Honestly.

Costco, the Washington state-based wholesale club with a store in Brookfield, has teamed up with Aetna to sell personal health insurance to its members in Connecticut.

Tired of those climbing premiums at work? Tired of the high cost of prescription drugs, even the generic ones? Well, the Costco option just might be for you.

As the national debate over health care and Obamacare rages toward November, Costco is capitalizing on a free market economy to offer five plans issued by Aetna.

The health plans, which went into effect April 24, have deductibles ranging from $3,000 to $7,500. The plan highlights include $15 copays for generic drugs at Costco pharmacies, the flexibility to see a specialist without a referral and unlimited lifetime coverage.

It was not immediately clear if Costco would provide in-store insurance samples to go with those mini-bagels and fruit smoothies.

Clark Howard, a nationally syndicated consumer watchdog, said he believes the insurance alliance between Costco and Aetna is a good thing.

“Aetna has always lived on the big employer market, but as more employers are deciding they can’t afford to be insurers, they’re now making the move to individual health policies,” Howard wrote in a blog post Tuesday.

“It’s a particularly smart move for the insurer because Costco customers tend to be higher income, better educated and healthier than the general population.”

Just ask any underwriter.

Demographics are a big reason why Connecticut is one of nine states where Costco and Aetna currently offer personal health insurance.

The Costco Personal Health Insurance program is also available to members in Arizona, Michigan, Georgia, Illinois, Pennsylvania, Texas, Nevada and Virginia, according to Aetna officials, who hope to add more markets later this year.

The insurance game is nothing new for Costco, of course.

Costco has teamed with Ameriprise to sell automobile and home insurance, complete with multi-policy discounts, to its members for years.

So why get into the personal health insurance business now?

For Costco, it’s another salvo in the high-stakes battle for your wholesale club dollars.

One of the epicenters in this turf war — or at least a fault line — rests on Federal Road in Brookfield.

As Costco expands at 200 Federal Road — literally and figuratively, with new insurance products, a blown-out wall to increase its capacity and a new gas station operation behind Union Savings Bank — BJ’s Wholesale Club is under construction down the street at 106 Federal Road.

And guess what?

BJ’s offers individual and family health insurance policies, too, except their policies are issued through eHealthInsurance and carriers such as Aetna, Anthem and ConnectiCare.

“The arrangement between Aetna and Costco is not unprecedented nor is it a result of health care reform. Insurance companies have been offering policies through associations for many years,” Connecticut Insurance Department spokeswoman Donna Tommelleo said Thursday in an email to The News-Times.

“This is no different than insurance being offered through AAA, AARP, alumni groups or other associations. In Connecticut, as long as they meet all the statutory requirements for state approval and are being offered by a licensed carrier or agent, there’s no prohibition.”

So the next time you go to Costco — or even BJ’s after it opens — don’t forget to shop for health insurance along with that tub of shampoo and the free-sample snacks.